Mexico's New Anti-Money Laundering Law is Bad for Business Dale Quinn - Quartz
go to original October 29, 2013

Cash left hanging out to dry (Reuters)

Money laundering in Mexico is big business: $10 billion in drug money was washed there in 2012, according to global risk management firm Kroll. Even so, Mexico’s latest attempt to crack down on the crime puts a hefty burden on the private sector in a country that’s been slow to target known launderers.

The law went into effect in July and focuses on “vulnerable activities,” or industries like gaming, jewelry, automobile, art and real estate that are often targets for money laundering because they handle large amounts of cash. The requirements vary per sector, but for most, cash transactions over a certain amount must be reported to the government. In certain cases, identification is required for purchases regardless of the form of payment.

Jewelers will have to maintain files for customers who make purchases valued at more than 52,000 pesos, or roughly $4,000. This create challenges for jewelers who deal with international clients, said Miguel Cotero Ochoa, the president of the state of Jalisco’s Jewelry Chamber. Those clients will likely turn to other countries that don’t require such bureaucratic entanglements, he said.

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